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and is attributable to a tax-motivated transaction. The
increased rate of interest is effective with respect to interest
accruing after December 31, 1984, even though the transaction was
entered into before that date. See Solowiejczyk v. Commissioner,
85 T.C. 552 (1985), affd. without published opinion 795 F.2d 1005
(2d Cir. 1986). Section 6621(c) was repealed by section 7721(b)
of the Omnibus Budget Reconciliation Act of 1989, Pub. L. 101-
239, 103 Stat. 2399, effective with respect to returns the due
date for which is after December 31, 1989.
As indicated, additional interest applies only if an
underpayment of tax is attributable to a tax-motivated
transaction. The term “tax-motivated transaction” is defined in
section 6621(c)(3) to include any valuation overstatement within
the meaning of section 6659(c), see sec. 6621(c)(3)(A)(i), or any
sham or fraudulent transaction, sec. 6621(c)(3)(A)(v).
There is no dispute in these cases that petitioners’
underpayment of tax for 1982 is attributable to tax-motivated
transactions within the meaning of section 6621(c)(3)(A).
Likewise, there is no dispute that petitioners paid
the additional interest under section 6621 that was assessed by
respondent and that petitioners have the opportunity in the
present cases to contest their liability for such interest
pursuant to the Court’s overpayment jurisdiction. See sec.
6512(b); Barton v. Commissioner, 97 T.C. 548 (1991). It is in
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